About the High Line

The High Line is a new public park, built on an elevated 1930s rail structure located on Manhattan's West Side. It runs from Gansevoort Street in the Meatpacking District to 34th Street. The first section of the High Line opened to the public in June 2009. The High Line is property of the City of New York, and is maintained and operated by the non-profit Friends of the High Line, in partnership with the New York City Department of Parks & Recreation.

The MTA met today with Tishman Speyer. Despite the best efforts of both sides, a final agreement could not be reached. The MTA has now re-entered discussions with other interested developers and remains committed to timely development of these unique and valuable parcels of land on Manhattan’s Far West Side.

It’s widely believed that the most likely developer right now is the partnership of the Durst Organization and Vornado Realty Trust.

For the very first time that we are aware of, the High Line was featured in a New York Times Editorial. In it, America’s paper of record challenges the City and Tishman Speyer to seize the opportunity provided by the development rights to the West Side Rail Yards and to do the right thing and “preserve all of the High Line, the 1.5-mile stretch of elevated railway that is being transformed into a green jewel of public space.”

There was considerable pride and a few tears as we read this unprecedented shout-out by the Times.

The MTA announced today that it has selected Tishman Speyer as the developer for the West Side Rail Yards. This announcement ends a 6-month bidding process, which originally involved 5 competing developers. Tishman Speyer outbid the only other remaining contender– a joint venture between the Durst Organization and Vornado Realty Trust– by $112 million, offering to pay $1.004 billion for the rights to develop the 26-acre site.

Tishman Speyer’s initial bid plan for the rail yards can be seen here. The developer is working with architect Helmut Jahn, landscape architect Peter Walker, and master planner Cooper Robertson. They plan to build 10 million square feet of commercial space, 3 million square feet of residential and leave 13 acres of open space.

Given the sudden change in gubernatorial administration, many thought the rail yards bid process would be delayed, so the MTA’s announcement comes as somewhat of a surprise. Tishman Speyer’s anchor tenant, Morgan Stanley, reportedly dropped out of the deal earlier this month.

Tishman Speyer’s plan preserves most of the High Line, but proposes to demolish the spur over Tenth Avenue, and part of the section along 30th Street.

Statement regarding the MTA’s selection of Tishman Speyer as the developer for the West Side Rail Yards

Friends of the High Line commends the MTA’s, Governor Paterson’s, and Tishman Speyer’s commitment to preserving the majority of the historic High Line structure at the rail yards, and we look forward to working with all parties to ensure that the remaining sections– the spur over Tenth Avenue and the full section along 30th Street– are preserved as well.

The treatment of the High Line in Tishman Speyer’s bid shows considerable progress from the days when it was presumed the site could not be developed without its demolition. We applaud the MTA, Governor Paterson, and Tishman Speyer for their recognition of the High Line as an asset. We are encouraged that they now share our vision of a continuous walkway, connecting the new residential, commercial and open space at the rail yards with the gallery district of West Chelsea and south to Gansevoort Street, that will be the next great city public park for New Yorkers and visitors alike.

We look forward to working with Tishman Speyer and the MTA to ensure full preservation of the entire historic High Line structure, including the spur over Tenth Avenue– almost 1/3 of the rail yards section. Additionally, we hope to work with the leadership of the Javits Center to ensure that a pedestrian easement is preserved on the 33/34 block, north of the rail yards site, so that the High Line may extend to connect with the Javits Center and the planned #7 extension.

We owe a great deal of our success so far in this process to the tireless support of our elected officials: Mayor Michael R. Bloomberg, Governor David Paterson, City Council Speaker Christine C. Quinn, Congressman Jerrold Nadler, Borough President Scott Stringer, and State Senator Tom Duane, as well as the advocacy efforts of Manhattan Community Board 4, and our Friends of the High Line volunteers and supporters. Our rail yards advocacy would not be possible without the generous financial support of the A.G. Foundation, the Greenacre Foundation, the Leon Levy Foundation, John and Wendy Neu, and Wendy Keys and Donald Pels.

Tishman is one of four remaining bidders for the site, (Brookfield Properties dropped out last week) and, until today, was one of three with an anchor tenant.

Related has secured Newscorp and Durst-Vornado is working with Conde Nast on their bid. Extell is the remaining bidder with no major tenant backing going into the bidding process. While Tishman is not out of the race officially, MTA execs have made their preference for bids with anchor tenants known.

Morgan Stanley’s retreat is yet another sign of the increasing trepidation among would-be investors in this mega-site. Given the uncertain future of the real estate market, it’s no surprise that bidders are hesitant about this enormous investment. According to the Times,

The winning bidder will have to put up $20 million immediately and complete a final contract within four months, when it must make a $100 million down payment. The transportation authority expects that it will take 18 months after that to prepare the property for construction, and two to three years and about $1.5 billion to build platforms and foundations over the railyards.

The MTA maintains that a bidder will be chosen by the middle of March.

Unsurprisingly in the wake of the subprime crisis and general market shakiness, much of the Rail Yards dialogue has turned away from design and towards financials.

Of course, guessing is a bit tough, given the MTA’s refusal to make the financial bids public (which the HYCAC called for as part of its summary of top community concerns).

Background on the financial situations of each of the developers has led to a lot of speculation over which one would be the surest bet for the MTA, an agency that knows its way around fiscal headache.

A Crain’s editorial recently endorsed Related and Tishman Speyer for the site, pointing to anchor tenants to add heft to the deal:

There are no more resourceful, experienced or financially solid real estate companies in New York. Their tenants—News Corp. for Related and Morgan Stanley for Tishman—offer a strong likelihood the project will get off the ground.

The Crain’s site is for subscribers only, but the complete editorial is after the jump.

Over the next few weeks, we’ll be providing you with some quick-hit style background information on the various developers who have submitted bids for the West Side Yards site. Today, we’re starting with Tishman Speyer, whose bid is pictured above.

Founded in 1978 in New York, Tishman Speyer (“TS”) has managed 77 million square feet of real estate assets since its inception. In the last three years, the company has been involved in three of the largest real-estate deals in American history. TS is traded publicly and has around 1100 employees in 25 offices worldwide. They recently spearheaded (along with Lehman Brothers), a takeover of Archstone, which was at the time the third largest Real Estate Investment Trust (REIT) in the country.

After the jump, check out the details of some of Tishman Speyer’s notable developments and properties.